Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: It was curtains for shares of Stage Stores (SSI) today, as they fell as much of 12%, after missing same-store sales estimates for December.
So what: Overall revenue in the all-important holiday-shopping month increased by 5%, but comparable sales only improved by 2.7%, below the analyst consensus of 5%. Management cited some "early softness" in the shopping season, but said that the final week of sales were strong. CEO Michael Glazer explained:
As has been the pattern over the last several years, our customers clearly waited until the last minute to complete their holiday shopping.
Comps for the combined November and December period gained 5.9%.
Now what: December is a crucial month for retailers like Stage, which operates brand name and off-price stores such as Bealls, Goody's, and Palais Royal, but same-store sales for the month were disappointing across the industry. Several reports asserted that concerns about the fiscal cliff kept some shoppers home or spending less. Even without the macroeconomic slowdown, a 2.7% bump is far from alarming. I wouldn't change my investing thesis based on today's news.
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